By Stephen Kirkland June 17 (Bloomberg) -- European stocks and U.S. index futures gained and the euro strengthened as a Spanish bond sale eased concern the government will struggle to finance its burgeoning deficit. Copper and oil retreated and gold rose. The Stoxx Europe 600 Index added 0.6 percent at 11:55 a.m. in London and futures on the Standard & Poor’s 500 Index jumped 0.4 percent. The euro rebounded, climbing as much as 0.7 percent versus the dollar. The Swiss franc appreciated against all 16 of its most-traded counterparts after the central bank softened its stance on restraining the currency. Copper fell 1.7 percent, the most since June 7, oil declined for the first day this week and gold advanced 0.5 percent. The MSCI World Index has gained for eight days, rallying 6.9 percent from its 10-month low on June 7 on evidence the global economy is weathering Europe’s debt crisis. Spain sold 3.5 billion euros ($4.3 billion) of 10-year and 30-year bonds at yields lower than the prevailing market rates, attracting bids worth as much as 2.45 times the securities on offer, assuaging concern that it would face difficulty meeting bond repayments. “The strong demand for Spanish bonds should help restore confidence,” Ciaran O’Hagan, a fixed-income strategist at Societe Generale SA in Paris, wrote in a research note today. The MSCI World’s eight-day advance is the longest stretch of gains since July 2009. European banks led the Stoxx 600 higher for a seventh day, extending its longest rally in nine months. Spain’s gauge of 35 stocks increased the most among 18 benchmark indexes in western Europe, rising 1.4 percent to a one-month high. Bonds Rally Spanish bonds rose, with the yield on the 10-year note falling from the highest level in almost two years. The yield dropped five basis points to 4.88 percent after earlier touching 5.04 percent. The difference in yield, or spread, between German and Spanish 10-year government bonds narrowed five basis points to 216 basis points. Spain is trying to convince investors it can cut the euro- region’s third-largest deficit, while propping up the country’s savings banks and lifting the economy out of a two-year slump. Spain, which faces 24.7 billion euros of maturing debt in July, had seen the risk premium on its 10-year bonds rise to a decade high on concern it may need to tap a European Union financial lifeline. BP Plc, battling to contain the worst oil spill in U.S. history, rallied 7.1 percent as the company scrapped dividends and pledged asset sales to meet President Barack Obama’s demand for a $20 billion fund to help victims. Spreads Narrow BP’s European bonds rose, with the spread on its 1 billion euros ($1.2 billion) of 4.5 percent notes due November 2012 narrowing to 555 basis points, from 696 basis points yesterday, according to HSBC Holdings Plc prices on Bloomberg. Credit- default swaps to insure the company’s debt for one year tumbled 521 basis points to 476, CMA DataVision prices show. The gain in U.S. futures signaled stocks may rebound, after the S&P 500 yesterday slipped 0.1 percent. The cost of living in the U.S. probably dropped in May for a second month, pointing to an expansion with little inflation, economists said before reports today. The consumer price index probably fell 0.2 percent after a 0.1 percent decline in April, according to the median forecast of 79 economists in a Bloomberg News survey before the report at 8:30 a.m. in Washington. The Conference Board’s leading economic indicators, a measure of the outlook for the next three to six months, may have increased 0.4 percent in May, the 13th gain in the past 14 months, the survey showed. The report is set for 10 a.m. Other reports today may show fewer Americans applied for jobless benefits last week and manufacturing in the Philadelphia region expanded this month. Euro, Franc The euro rose, mirroring the gain in the S&P 500 futures index. The currency advanced 0.6 percent to $1.2379, and 0.4 percent to 113 per yen. The yen was little changed at 91.32 versus the dollar. The Swiss franc approached an all-time high against the euro after the central bank softened its stance on fighting franc gains as deflation risks ease. The franc appreciated 1.1 percent against the euro to 1.3768 and 1.2 percent to 1.1176 per dollar. The Swiss National Bank, which has been buying foreign currencies since March 2009 to counter the threat of deflation, said today that those risks have “largely disappeared.” It also held the three-month Libor target rate at 0.25 percent at its quarterly meeting in Geneva. The MSCI Emerging Markets Index rose 0.7 percent, climbing for an eighth day in the longest stretch of gains in two months. Benchmark indexes in Turkey, Indonesia, Egypt and Romania climbed more than 1 percent. Copper for delivery in three months declined $100 to $6,550 a metric ton on the London Metal Exchange. Crude oil futures for July delivery fell 0.4 percent to $77.36 a barrel on the New York Mercantile Exchange. Gold climbed $7.10 to $1,237.60 an ounce. To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net;

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